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Retirement, Superannuation

Demographics favour regular reporting

SMSF fund reporting

The domination of SMSF establishments by younger individuals bodes well for the accelerated adoption of more frequent fund reporting.

The shift away from retirees and pre-retirees being the dominant cohorts regarding SMSF establishments indicates a significant move towards more regular fund reporting could be imminent, a technical services manager has predicted.

Statistics compiled by SMSF administration specialist firm Super Concepts show individuals aged between 35 and 54 accounted for 65 per cent of fund set-ups during March 2019.

“We’re seeing generation X, our generation, who are the ones [now] setting up SMSFs,” SuperConcepts SMSF technical support executive manager Nicholas Ali said during a webinar held this week.

“So we do have the majority of funds being set up by that cohort, that 35 to 50 cohort, and those people tend to be technology savvy.”

According to Ali, the tech-savvy characteristic possessed by this group will make them more conducive to regular reporting practices for their SMSFs as the push to do so will be technology driven.

This shift in the demographic of SMSF trustees will also alleviate the sector’s experience to date where older fund members have been reluctant to move away from manual reporting processes and in turn making them unwilling to adopt a more frequent reporting approach, he pointed out.

However, SuperConcepts Queensland state sales manager Gary Johnston said this situation can also be addressed if the benefits of regular reporting are explained to these clients.

Johnston revealed he usually tells these clients the increased use of technology will allow for less time to be spent on menial tasks and more time on services that add real value.

Despite the demographic shift in the establishment of SMSFs providing an optimistic outlook for regular reporting, he conceded there are other factors hindering the adoption of this more efficient process for certain funds.

“If you’ve got private unit trusts and the super fund investing in those, then clearly we’re not going to be able to get that information fed into the system or have it at a quick glance because [that information is generally compiled] by other accountants, or other parts of your business, and they may not be ready until the lodgement deadline for the trust,” he said.

“That could be 15 May or whenever it is in the following year.

“Properties are [also presenting] a little bit of a teething problem in the industry. We haven’t been able to properly data feed every single rental statement or anything like that.”

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